Case Title: M/s. Neelam Rubbers v. Chief Commissioner of CT & GST, Odisha
Court: High Court of Orissa at Cuttack
Petition No.: W.P.(C) No. 10859 of 2025
Category of Dispute: Refund – Supplies to SEZ
Date of Judgement: 12 August 2025
Relevant Sections: Sections 16 and 54 of the CGST/OGST Act, 2017; Rule 89 of the CGST Rules, 2017
Facts (Para 1–4)
M/s. Neelam Rubbers, a proprietorship concern registered under the CGST and OGST Acts, supplied goods to units in a Special Economic Zone (SEZ) and claimed refund of tax paid on such zero-rated supplies under Section 16 read with Section 54 of the Act, submitting the Chartered Accountant’s certificate as required by Rule 89. The refund application, however, was rejected ex parte by the Joint Commissioner, Balasore, vide order dated 25 February 2023.
A show cause notice in Form GST RFD-08 had been issued on 23 February 2023, requiring reply by 26 February 2023. The petitioner could not respond as she was under treatment for carcinoma left lower alveolus post-operation at Sum Ultimate Hospital, Bhubaneswar from 17 February to 10 May 2023. Due to these uncontrollable medical circumstances, the reply could not be filed in time.
Questions Before the Court (Para 1 & 4.1)
Whether rejection of the refund application without granting reasonable opportunity to the petitioner, who was prevented from responding due to serious illness, was sustainable under law?
Observations (Para 5–8)
The Court noted the undisputed medical evidence showing the petitioner’s prolonged treatment and hospitalization during the notice period. The Standing Counsel for the State conceded that the illness was not within the knowledge of the authority while passing the order. The Court held that since the petitioner was incapacitated and thus could not reply to the show cause notice, the rejection order caused grave prejudice and violated principles of natural justice.
Judgement (Para 8–9)
The High Court set aside the refund rejection order dated 25 February 2023 and directed:
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The petitioner shall appear before the authority on or before 26 August 2025 with books of accounts, tax invoices, returns, and supporting documents to justify the refund claim.
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The authority shall verify and adjudicate the claim after granting reasonable opportunity.
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The process shall be completed by 15 September 2025.
The writ petition was thus disposed of with these directions.
Summary of Cases Referred
| Case Name | Court | Issue | Verdict |
|---|---|---|---|
| M/s. Neelam Rubbers v. Chief Commissioner of CT & GST, Odisha | Orissa High Court | Refund rejection due to non-reply caused by illness | Order set aside; refund claim to be reconsidered after granting opportunity |
Between Fine Lines
This judgment reinforces that refund claims under GST cannot be denied merely due to procedural lapses when taxpayers are prevented by genuine circumstances like medical emergencies. Authorities must adhere to audi alteram partem and ensure fair hearing before rejecting any claim, particularly under Section 54 dealing with zero-rated supplies to SEZs.
Disclaimer – “The above summary is for academic purpose only; not formal legal opinion. Seek professional opinion before application. Author or publisher or website shall not be responsible for any usage in any form.”
